Huge Branch Closures Announced By LSL

LSL Property Services has announced a major restructuring that includes a substantial number of branch closures, despite a ‘resilient performance’ during the second half of 2018.

Turnover for the year ending 31 December was up 4% thanks to a 3% growth in their estate agency division and 9% growth in surveying. The increase was ahead of the company’s own growth forecasts.

LSL’s plans

LSL’s restructuring plans include several elements, which will see a reduction in the total number of Your Move and Reeds Rains branches from 404 to 280. These include the development of approximately 144 ‘keystone branches’, which will each bear either the Reeds Rains or Your Move branding.

These will contain ‘larger teams of dedicated experts in Residential Sales, Lettings and Financial Services roles than the average Your Move and Reeds Rains branches have in place today’, with the aim that they will be centres of customer service excellence.

The establishment of these keystone branches will involve absorbing operations from around 81 smaller, neighbouring branches with some inevitable job losses. In addition to improving customer service, LSL believes that the creation of these larger branches will ‘deliver improved scale’ for the organisation.

In addition, around forty existing branches will be franchised, taking the total number of franchised businesses from 96 to approximately 136.

The franchises will be in ‘locations which geographically do not align with our proposed network of keystone branches within Reeds Rains and Your Move but which offer positive business opportunities to existing successful LSL franchisees within both brands’.

Forty three branches will be closed with personnel offered alternative employment wherever possible. However, job losses will be unavoidable, and a consultation is being entered into.

In addition, LSL has also announced that the existing Residential Sales and Lettings system software will be replaced with the same solution that is currently being operated by one of their other brands, Marsh & Parsons, for better functionality and processes.

LSL’s other brands

LSL operates two other brands: Marsh & Parsons and the LSLi Estate Agency subsidiaries, and is a major investor in online estate agency Yopa.

These will be unaffected by the changes, with LSL’s plans to expand the number of Marsh & Parsons branches to 36 over the medium term, with the aim of growing the business outside of central London remaining unchanged.

The LSLi group operates 57 branches and it will continue with its existing strategy to develop the nine brands they have established in the South East of England.

LSL’s statement

Despite the announced plans, LSL remains positive about the future of traditional agencies, as the statement from Helen Buck, LSL’s executive director for estate agency at LSL, which also has a stake in online agent Yopa, made clear:

‘The strategic changes announced today follow the completion of our ways of working programme and continues to support our long standing view that traditional estate agents will represent the substantial majority of the residential sales and lettings market for the foreseeable future and that our estate agency branches will continue to remain core to providing the service our customers expect.’